Interest rate rise a sign Britain is back to normal, former chancellor says

While the world's economies are struggling under severe recession problems, Britain stands alone in Europe. Smart enough to avoid the Euro and emerging from recession bringing hope to others.

Lord Lawson of Blaby   Photo: SE7

Lord Lawson of Blaby, the former Conservative chancellor, says that a rate rise this year signalled by Bank of England Governor Mark Carney would be a sign that Britain has finally got over the recession

The Telegraph
By Peter Dominiczak
13 June 2014

A pre-election rise in interest rates would be a clear sign that the UK is over the worst of the economic downturn and is “returning to normality”, a former Conservative chancellor has said.

Lord Lawson of Blaby said that a warning from Mark Carney, the Bank of England Governor, that rates could rise before next spring, is a sign that Britain is out of a “long period of recession”.

He called for a 0.25 per cent increase in rates this year and warned that Mr Carney has in the past been too cautious with regard to interest rate rises.

However, he said that ministers need to “start winding down” the Help to Buy mortgage guarantee scheme to prevent a damaging house price boom.

House prices are rising at more than 10 per cent a year in some parts of the country, and a growing number of economists is warning of a bubble that could leave some households with unsustainable debts and lead to financial instability.

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